Mar 19th, 2009

Dairy farmers protest at EU Office in Dawson Street and blame Commission directly for the collapse in milk prices

Leading a group of dairy farmers from all over Ireland in a protest/occupation of the EU Commission's offices in Dawson Street, the President of ICMSA, Jackie Cahill, said that the dairy policy being operated by the EU has actually reduced Europe's to producing milk below the cost of
production and left farmers with no income at precisely the same time as they are having to re-pay loans taken out to comply with the massive demands made by EU Nitrates Regulations. Mr Cahill said that the EU dairy policy was now inflicting long term, structural damage on Ireland's dairy industry and the wider agri-food sector so vital in any co-ordinated attempt to re-build our exporting sector.

"The EU has so comprehensively mismanaged the Union's dairy market that virtually all EU farmers are now producing milk at below-cost production. In Ireland, as prices slip back to 23 cents per litre, we now have a situation where the costs of production are 3 cent higher than the price farmers receive. In the face of this catastrophic mishandling, we still have the EU Commission talking about 'a soft landing' and de-regulation. De-regulation, in this context, means only one thing: even lower prices and even more volatility. The Commission is recklessly undermining a vital part of our food industry - not just in Ireland but across Europe", said Mr Cahill

"All the talk about a soft landing, all the talk about the de-regulation and the taking-up of quotas is not alone useless, but amounts to a virtual fraud on the farm families who made huge investment on their enterprises and who are now forced to produce below the cost of production", he continued.

For the first time ever, virtually all dairy farmers in Ireland will incur a loss on their enterprises at the same time as they have invested unprecedented amounts of borrowed capital to comply with very stringent EU and Irish regulations on the Environment. Why has all this happened?

"As part of the EU Farm Council, Commissioner Fischer Boel and Minister Smith will blame virtually everything else apart from their own cack-handed mismanagement for the collapse in farmer incomes. Their continuance with a 'hands-off' policy of de-regulation and the systematic undermining of family dairy enterprises contrasts starkly with a situation where virtually every other economic activity is being regulated or supported by Member Governments. We know one thing with absolute certainty about the Commission's policy on European dairying: if the European milk sector is to be de-regulated then prices will fall further. The Commission and the Farm Council, who meet on this matter next Monday in Brussels, must again be told in the clearest terms - as they are being told today - that the abolition of any form of supply-management system will mean world prices for EU farmers.
We cannot produce milk at world prices regardless of how efficient we are. This is the reality and the Commission's failure to grasp this inescapable fact is both depressing and alarming", stated the ICMSA President.

"The EU must continue with supply-management, which simply means that production is managed to levels of demand for milk and dairy products. This has been the system for over 25 years. If there are increased market opportunities - which there may well be - then milk quota amounts can be expanded to meet this increasing demand. A free-for-all, de-regulated system is neither good for consumer or farmers as prices will fluctuate by as much as 100 per cent from year to year. Our message to Commissioner Boel and her Commission colleagues today is very clear: you are responsible for the chaos in the dairy sector and the huge losses being suffered by dairy farmers at present. It is your responsibility to correct this"

Mr. Cahill said that immediate action is required on the operation of the EU intervention system, export refunds and other measures that could provide a solid floor for milk price so that normal market prices can be restored as soon as possible.

These measures were available until recently to support what is effectively a structural surplus of milk production in Europe. The withdrawal of these measures, while simultaneously 'green lighting' increased production of milk was both illogical and reckless, concluded the ICMSA President.

BACK TO 2009 ARCHIVES